Online clothing rental involves a novel concept where consumers can rent clothes for a specific period of time. People who are looking for designer dresses but lacking financial resources make use of these services. Also, people who are participating in different events such as parties, sports events, theme parties, and photoshoot can make use of this service.
Global online clothing rental market is estimated to account for around US$ 993.8 million in terms of value in the year 2019 and it predicted to grow at a CAGR of 10.2% during the forecast period (2020-2027).
Growth in the urban population due to increasing urban upper class and high net worth individuals is creating demand for online clothing such as premium products. According to the United Nations, now 55% of the world’s population lives in urban areas, a proportion that is expected to increase to 68% by 2050. Projections show that urbanization, the gradual shift in the residence of the human population from rural to urban areas along with the overall growth of the world’s population could add another 2.5 billion people to urban areas by 2050.
The growing popularity of fashion vlogs coupled with the rise in the television industry is projected to bring new market opportunities over the forecast period. Television industry require clothes for a short duration and thus prefers renting the clothes instead of purchasing. Moreover, increasing number of online portals for renting clothes is further anticipated to accelerate market growth of online clothing rental over the forecast period.
Challenges associated with apparel inventory management as the majority of fashion trends are seasonal and have a short lifespan. Most of the retailers offer price discounts after the decline of seasonal fashion trend when the most of the customers are no longer interested in purchasing these products. This is expected to restraint the market growth of online clothing rental.
On the basis of region, North America region dominated the global online clothing rental market in 2019 with a 42.1% of market share in terms of value, followed by Asia Pacific and Europe respectively.
On the basis of product type, western wear segment dominated the global online clothing rental market in 2019 with a 91.2% of market share in terms of value.
Monthly/quarterly subscription service is a growing trend in the online clothing rental industry where retailers provide subscribers rented clothing on a monthly/quarterly basis. For instance, in August 2019, Scotch & Soda has launched a new online subscription service offering unlimited access to the brand’s menswear collection. New service is the first apparel subscription rental service to be offered by a retail brand in the menswear market. The new service, priced at $99 per month for a 3-garment plan, includes priority shipping, unlimited exchanges and returns, and complimentary laundering.
Clothing Rental Market - Impact of Coronavirus (Covid-19) Pandemic
Many people who use clothing rental service are giving up their memberships during this global crisis. With many people around the world are working remotely and concerns over saving money mounting, clothing rental is looking as an unnecessary expense. According to Coherent Market Insights, online clothing rental market is expected to grow at lower CAGR between 2020 and 2021.
Few Recent Developments
In March 2020, Rent the Runway adds a new subscription option. The clothing and accessories rental service has launched a two-swap plan. The new two-swap model gives users the ability to swap out four items two times each month. It costs $135 per month.
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